If you have a strong dissenting opinion after reading these summaries, pause for a second, and reflect.В Opposing evidence is important, especially when it is emotionally inconvenient.В Because questioning popular narratives is socially and politically difficult, these attempts at replicating academic and practitioner research are more the exception than the norm.Д®very week or so, I get one of the following two versions of phone calls or emails from friends and acquaintances in practice: (i) an excited practitioner calls and tells me about a great new finding documented by either an academic or a consulting or advisory business about asset pricing or ESG issues or corporate behavior and (ii) a skeptical CEO, board member or an asset manager asks me if some often-repeated research by an academic or a consulting firm is actually true.В My response is almost always, вЂњtrust, but verify.вЂќ Meanwhile Robb and Sattell question conclusions of Morgan StanleyвЂ™s Institute for Sustainable Investing (MSCI) that sustainable investments outperform the market, while Green and Hand suggest that more successful firms hire racially diverse executives as opposed to McKinseyвЂ™s claims that the chain of causality works the other way around.В My own paper with Jeet Aswani and Aneesh Raghunandan asks whether carbon emissions are indeed priced in todayвЂ™s stock returns.

Now that the pandemic is relatively receding in the U.S., ESG is back in the forefront of business and academia, while Europe reported a huge ESG asset boom last year.В However, the evidentiary foundation behind the narrative that ESG metrics inform investors about future stock or operating performance is increasingly in question.В For instance, Berchicci and King challenge the often-cited evidence that material SASB metrics predict positive stock returns.

An inconvenient truth stream